Democrats’ override
mends union rift

Binding arbitration returns as
lawmakers overturn a Lingle veto

The passage this week of a bill to help the Hawaii Government Employees Association also will help patch a rift between local Democrats and Hawaii's labor community.

The relationship between Democrats, who have always considered the labor unions to be allies, and the politically powerful unions, especially HGEA, has been estranged in recent years.

One of the reasons has been the drive for civil service reform started by former Gov. Ben Cayetano, a Democrat, who relied on union support for his election victories but suffered through a series of public worker strikes and union lawsuits.

Part of the civil service reform was repealing binding arbitration, which allowed a third-party arbitrator to award the unions with a pay raise or settlement, without threatening to strike.

Cayetano said yesterday he considered the old binding arbitration law unfair to the state.

"Arbitrators never look at the big picture," Cayetano said. "The idea that a panel of nonelected people will make decisions which may adversely affect the state's ability to serve the most vulnerable segment of our population is something I cannot buy."

Repealing binding arbitration in 2000 drove a wedge between the unions and Democrats in the Legislature.

"Labor has felt it truly was left out," said Senate President Robert Bunda (D, Wahiawa-Pupukea).

Although Hawaii's faltering economy limited how much the state could give the unions, Bunda said there was also a feeling "that the Legislature betrayed them."

So if Democrats were the ones who inflicted pain on the unions, it would have to be the Democratic majority that repaired the damage.

"The arbitration was repealed at the request of Gov. Cayetano and done with the full support of the Democrats -- within the span of three years, they turned 180 degrees on the issue," said J.N. Musto, executive director of the University of Hawaii Professional Assembly, another public employee union.

Rep. Joe Souki (D, Waihee-Wailuku), the influential former House speaker, said he helped put together the votes to repeal the binding arbitration bill.

"I think it was some of the legislators who felt for the good of the Democratic Party and for the good of labor, we should begin to sit down and see where we can work together," Souki said.

After the bill passed, Gov. Linda Lingle vetoed it, saying the measure would cost the state too much money and remove the responsibility for the state and the unions to bargain honestly.

Lingle said binding arbitration "encourages both sides to take extreme positions" that result in the arbitrator splitting the difference and "dramatically reducing the accountability of union leaders and public officials."

But, as Souki said, "we both recognized that we need each other," and the Democrats started work on organizing a veto override legislative session.

While Democrats maintain they did not know if they would have the votes to override the binding arbitration veto, Republicans claim Democrats did not signal their intentions until it was too late to build community support against it.

"No one knew until the last minute that the bill was even under consideration," said Rep. David Pendleton (R, Maunawili-Kaneohe). "It would have been interesting to see what would have happened if there was an education campaign on what this will mean -- then others besides the union could testify."

Tuesday night, however, the Legislature voted with almost solid Democratic unity to restore binding arbitration.

The only Democrat to vote against the bill was Sen. Colleen Hanabusa, who as Democratic leader was in the odd position of bucking all 14 other Senate Democrats.

"I have philosophical problems with binding arbitration because the union members don't have the power to reject a settlement if they don't like it. My colleagues understood the reasons," Hanabusa said.

After the veto override, HGEA Executive Director Russell Okata said it was "a defining moment in Hawaii's political history."

"This is a win for Hawaii and the people, especially working people," he said.

Hanabusa noted that the vote will be valuable next year.

"It will help candidates. It has got to have a positive impact in terms of the people running for re-election," she said.


Lingle to ask
for state pay caps

The Lingle administration will ask next year's Legislature to put a ceiling on pay increases awarded when labor contracts for public employees are resolved through binding arbitration, state Chief Negotiator Ted Hong said yesterday.

"The governor values the use of arbitration but is concerned there will be no way to determine what the resulting costs will be to the state," he said. "We'll suggest they put a ceiling on it," possibly tied to the Consumer Price Index, which measures the growth in the cost of living.

Hong commented a day after the Legislature overrode Gov. Linda Lingle's veto of a bill that would restore binding arbitration as the solution in resolving labor disputes for 23,000 state and county white-collar workers.

The workers represented by six bargaining units of the Hawaii Government Employees Association were given the right to strike to settle contract disputes as a major provision in the 2000 Civil Service Reform Act, which was strongly opposed by the union. That has been reversed.

Those employees are covered by contract extensions that expire June 30.

Hong said unions covered by binding arbitration usually ask for twice as much as they want because they know arbitrators will give them about half.

"We just had one union that asked for a 40 percent increase (in pay) and ended up getting 20 percent over four years," he said. "They knew they would get something in the middle, and they did."

Hong said caps on binding arbitration awards are common in collective bargaining in the private sector.

HGEA Executive Director Russell Okata, meanwhile, applauded Tuesday's override vote. "I'm personally relieved because the reinstatement of arbitration will provide stability to our members and uninterrupted service to the public," he said.

Okata and other top union officials sat in the gallery of both the House and Senate and watched as the Democratic majority voted to override the Republican governor over strong objections from the outnumbered Republicans.

Sen. Sam Slom (R, Diamond Head-Hawaii Kai) called binding arbitration "a win-win situation for public employee unions and a lose-lose situation for the taxpayers who ... wind up picking up the tab."


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